Attorney General Becerra Cracks Down on Tobacco Company for Selling Illegal Cigarettes

SACRAMENTO – California Attorney General Xavier Becerra filed a lawsuit against a Canadian cigarette manufacturer, Grand River Enterprises Six Nations (GRE), for failing to comply with California laws regarding tobacco sales and illegally selling the product in California. In filing this lawsuit, the Attorney General is enforcing the law by continuing to ensure tobacco companies comply with California’s financial and regulatory requirements, protect competition and, most importantly, prevent the sale of cheap, illegal cigarettes in the state.

“Protecting Californians, especially youth, from cheap, illegal cigarettes is a public health priority,” said Attorney General Becerra. “Bad actor tobacco companies that don’t follow the law and profit from illegal sales of their addictive product to Californians will be held accountable.”

The California Health and Safety Code requires that all cigarette manufacturers that do not participate in the tobacco Master Settlement Agreement—which GRE does not—make annual payments into an escrow fund for their sales in California. GRE sold hundreds of millions of cigarettes in California in 2014, 2015, and 2016 without making the required escrow deposits. As a result, it owes over $13 million in unpaid escrow, plus civil penalties to the state of California.

The Attorney General has also asked the Court to prohibit GRE from selling any brand of cigarettes, directly or indirectly, to consumers in California until GRE has remedied its violations by paying the sum it owes, including civil penalties and legal fees, and has provided annual certification of compliance with the Health and Safety Code.